Emerging technologies, such as the Internet of Things (IoT) and big data, are fundamentally changing how modern buildings are designed, built, and operated. This doesn’t appear to be a trend, either. Smart buildings aren’t just here to stay—they’re helping to shape the future.
Projected Growth of Smart Buildings
According to a Research and Markets report, more than 80% of new constructions incorporate at least one type of IoT or related smart building technologies. At this rate, the commercial smart building market is expected to grow nearly tenfold within the next five years to more than $51 billion globally by 2023.
North America is projected to lead the IoT smart building movement with 36% market share by 2023. Across all developed economies, roughly 90% of legacy commercial buildings will require substantial retrofitting to integrate smart technologies, contributing to rapid industry growth.
Trends Driving Smart Buildings
Building use is evolving, and modern occupants more from their space. These factors are driving the growth of smart buildings:
- Tenant demands for new technology: To remain relevant, businesses need to cater to tech-savvy workers who want—and expect—workspaces with the latest features. A Dell and Intel study reveals that 44% of office workers worldwide do not think their offices are smart enough. Younger employees may even consider quitting a job due to lack of technology in the office. The features that define a smart office still vary widely—including connectivity between systems, occupant-based control, and predictive analytics to predict system failures and other equipment problems—but many workers expect some intelligent systems in the workplace.
- Tools to improve space utilization: The average square footage per occupant has been steadily declining. New technologies collect data on which spaces are used throughout the day, as well as when they are in the highest demand and what roles use them most frequently. This data allows companies to be more efficient with office space and fit more people into the workspace without compromising comfort. For example, a smart office powered by IoT devices can generate a report on how often a certain conference room is used, when it’s often available, how much energy is being used, and when it’s going to be available again. This information can integrate with a calendar that shows employees which coworking spaces are currently available (and, with an integrated indoor map, exactly how to get there).
- Collaborative workspaces: Traditional models of workplace designs cram as many desks as possible into an office. However, agile models that prioritize open space for greater collaboration, innovation, and knowledge sharing are superseding traditional workspaces. Today’s workforce is more mobile and includes a greater number of remote and temporary workers who require work or meeting spaces on an ad-hoc basis, contributing to a paradigm shift in office design.
- Digital twin technology: Digital twin technology allows companies to create digital versions of physical assets, such as a 3D visualization of a smart office, that helps make decisions about space allocation, energy usage, building management, and many other scenarios. The benefits of digital twin technology have led many companies to invest in smart devices and smart office plans where building systems and resources can be managed easily in a visual interface.
Use Cases for Smart Buildings
While growth is evident across industries, the market potential for smart buildings is especially strong for offices, warehouses, hotels, and retail spaces.
Business leaders can leverage new technology to create offices that reflect the makeup of their workforce and general workplace trends. Smart workplace technology—which can include networked platforms, sensors, software, and IoT technology—can be used to improve workplace security, productivity, comfort, energy efficiency, and much more.
Connected systems and devices offer unprecedented scalability and efficiency for warehouse managers, many of whom still use manual processes. Today’s smart warehouses take advantage of IoT technology, connecting systems to streamline inventory management and increase productivity. Smart warehouses improve operational efficiency across the entire supply chain: automate routine tasks to optimize the workforce, fulfill orders faster for better customer service, and provide greater visibility to manage inventory, warehouse conditions, and logistics.
Competition in the hospitality industry is driving hotel owners to invest in smart building technologies that deliver more comfortable, intuitive, and individualized guest experiences. While most commercial buildings undergo renovations every 25 to 30 years on average, hotels are retrofitted with new equipment every 10 years or less. This offers hotels more opportunities to integrate technologies for increased room security, as well as customized climate, lighting and appliance control through mobile apps, and more. This year, hotels will spend more than $500 million on connected equipment and invest more than $2.2 billion to refurbish guest rooms.
As retailers shift their focus from brick-and-mortar stores to e-commerce, they must adopt new ways of thinking about retail spaces. Smart building technology can offer retailers a competitive advantage in the battle for consumers. For example, an indoor map app can provide direct navigation to a product, which enhances the shopping customer experience. Indoor mapping also can analyze the patterns of foot traffic to enhance store layouts and merchandising.
Getting Started With Smart Buildings
Buildings have joined the ranks of everything impacted by the wave of digital technology. Thanks to the combination of new technologies and IoT, smart buildings are revolutionizing various aspects of commercial real estate, from construction to occupancy to management.
WRLD enables smart buildings through immersive 3D maps and digital twins of any indoor space. Sign up today to create your own map, or contact us to learn more about WRLD smart building services.